Julian Sebastian, Juris Doctorate
Most of the Dow Jones’ 30 Industrial Stocks will follow Curve #1 very closely. The high point for most of these stocks will be reached around January 12th. After that time, prices should gradually work lower and the trend should be down until around March 28th to 29th, when bottom will be reached for another bull campaign. Many stocks will reach bottom around March 14th to 15th and remain in a narrow trading range until the bull campaign starts in April. When the advance gets under way, some stocks will reach top for the year in May, others in June and some of the others, which are behind the market, will reach final high in August as shown by Curve #1 and Curve #2. A large majority of stocks will not go any higher than the highs reached in the month of July. After July and early August, the main trend will be down and some sharp declines will take place, prices working lower and reaching first bottom around September 27th to 28th. From this level follows a fair - sized rally and a trading market running into the early part of November. After that, the big bear campaign will get under way and stocks continue to work lower, reaching extreme low level for the year around December 23rd to 24th. (Location 923)
They will advance while other stocks decline. Curve #2 indicates low around January 2nd followed by an advance up to January 31st; a decline to February 7th and high of next rally around February 15th. Then prices will work lower, making bottom around March 11th. Watch the stocks that make bottom at this time, as they will be the ones to lead the advance. After the low in March, this Curve continues to work higher with only moderate reactions until high is reached around May 17th to 18th. From this top a bigger decline will take place. The last low is indicated around June 22nd. From this level the stocks, which are in strong position and behind the market will gradually work higher, some of them reaching top during July while others will not reach final top until August 14th to 15th. After this top is reached heavy liquidation will start and prices will work lower from every rally. First decline culminates around September 30th; then a rally making top on October 2nd, followed by a decline to October 24th; then a final top around November 2nd to 4th, followed by a big decline, reaching bottom around December (Location 941)
The stocks given in the list below are the ones, which have been distributed and are the best to sell short around the dates indicated for the top on Curve #1. These stocks will have the greatest decline, especially in the early part of the year and again from August to December when a big bear campaign is indicated. (Location 970)
Therefore, it is well to watch the individual stocks. Watch those that make top in May, those that make top in June and those that make top in August. (Location 1027)
IMPORTANT DATES FOR CHANGE IN THE MAJOR TREND The following dates should be watched for important changes in the major trend of both Industrial and Railroad stocks. If any stock makes top or bottom around any of (Location 1057)
these dates, you can expect a reversal in trend, especially if there is a sharp decline or a sharp advance around these dates: Feb 8th to 10th, March 21st to 23rd, May 3rd to 7th, June 20th to 24th, August 3rd to 8th, Sept 21st to 24th, Nov. 8th to 11th, Dec. 20th to 24th. These dates are based upon a permanent cycle, which does not change. Important dates are based upon a permanent cycle, which does not change. Important tops and bottoms are made in many stocks every year around these times. Watch the stocks that reach extreme high or low levels around these dates. (Location 1059)
The following dates indicate times when stocks will be very active and have wide fluctuations, making tops and bottoms. While all stocks will not make tops and bottoms around these dates, some of the most active ones will and if you watch the ones that turn around these dates, it will prove helpful in your trading: (Location 1073)
March 10th to 11th, very important for change in trend; 21st to 22nd important; 28th to 29th another very important date for change. (Location 1083)
August – one of the most important months for change in trend. Many stocks will start on their long down trend. 7th to 8th – quite important; 16th to 17th important; (Location 1107)
HOW TO TRADE WITH THE FORECAST (Location 1137)
The big buying opportunity will come in March. Around March 10th to 11th and 28th to 29th, you should buy the best stocks to hold for the spring bull campaign into late May. (Location 1215)
from July and August you should play the short side and wait for rallies to sell short rather than buy on breaks because the main trend will be down and you should never buck the trend but go with it. (Location 1219)
Remember you must buy and sell at the right time regardless of prices. No matter how high stocks are, if they are going higher, you should buy. It makes no difference how low they are; if the trend is down and they are going lower, you must sell short and go with the trend. Take a loss quickly if you see that the Forecast is off or you have picked the wrong stock. Do not hold on and hope. Delays are dangerous. It is easy to make back small losses, but hard to regain big ones. Fo11ow the rule cut short your losses and let your profits run. Learn to act quickly. How much better to take action now than to trust uncertain time. (Location 1220)
The month of October indicates some advance in mining stocks. (Location 1256)
Expect heavy liquidation and a sharp, severe decline reaching bottom around the 28th for a moderate rally. (Location 1304)
A sharp decline fo1lows, making first bottom around the 14th to 15th; then a quick rally in many stocks reaching top around the 20th, followed heavy liquidation and a sharp decline to around the 28th or 29th when final bottom will be reached for another bull campaign. This is the time to buy the stocks in strong position as they will have sharp advances and work higher into the summer. (Location 1329)
The public will again come into the market on a large scale and there will be a wild wave of speculation, especially in the oils, coppers, rubbers, sugars and airplane stocks. (Location 1352)
This is a month for great activity in the stock market. We will hear some very bullish news about general business conditions. There will be some large combines, consummation of mergers; large financial deals will take place and there will be much talk of continued prosperity, all of which will cause the public to buy stocks at the top. General news will be very bullish and stocks will fluctuate over wide ranges. Some stocks will reach high around the early part of the month and have (Location 1383)
Another advance will take place this month and many stocks will have sharp rallies and reach the final high for the year. (Location 1445)